Shaghain Stocks Decline 2%

123jump.com Staff
11 Jun, 2008
New York City

Hong Kong market averages declined following the market trends in mainland trading after banks extended losses as Beijing increased its cash reserve requirement ratio for banks. Airlines and telecommunication stocks limited losses. In Shanghai trading, CSI 300 Index fell 2.07% or 6.26 at 3,150.30. In Hong Kong trading Hang Seng Index fell 0.20% or 47.92 at 23,327.60. China Netcom rose 2.2% and China Unicom increased 1.3%. However China Mobile plummeted 1.4%.

[R]6:00AM New York, 6:00PM Hong Kong - China’s producer prices rise 8.2% in May.[/R]

Hong Kong market averages declined mimicking trends of mainland stocks after banks extended losses as Beijing increased its cash reserve requirement ratio for banks. Airlines and telecommunication stocks limited losses.

Market sentiment

In Hong Kong] trading Hang Seng Index fell 0.20% or 47.92 at 23,327.60, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, dropped 0.68% or 86.84 at 12,703.03. In Shanghai trading, CSI 300 Index fell 2.07% or 6.26 at 3,150.30.

Daily turnover on main-board was HK$62.91 billion from HK$82.16 billion yesterday.

Producer prices rise 8.2% in May

China’s National Bureau of Statistics reported today on its website that the producer price index - which measures the cost of goods when they leave the factory - for China’s industrial products advanced 8.2% in May from 8.1% the previous month.

China insurance sector pays Rmb288.6 million in indemnity

The China Insurance Regulatory Commission reported today on its website that insurance companies paid Rmb288.6 million in indemnity for areas that were affected by the quake in the Sichuan Province.

Of the money paid Rmb159.6 million was in life insurance and Rmb129 million in property insurance.

CIRC noted that as of June 9, the sector had accepted 249,000 claims, involving 16,300 quake victims, 2,092 injured and 145,000 destroyed dwellings.

Shanghai oil futures rise more than 2%

China Daily reported today that Shanghai fuel oil futures contracts rose more than 2% yesterday following last week record jump in oil prices.

The most actively traded Shanghai fuel oil futures contracts for delivery in August rose 2.01% to Rmb 5,029 per ton, and the transaction volume declined 36.6% to 62,902 hands from Friday.

The report said the most actively traded crude oil futures contracts for delivery in July on the New York Mercantile Exchange dropped 0.51% to $133.66 per barrel in yesterday''s electronic trading.

Analysts said domestic fuel oil futures prices would continue the upward trend in tandem with international crude prices, which have surged an aggregate 14.6% over the past month.

""The international crude oil price shows little sign of falling back to its old levels. Breaking the $150 mark is now a matter of time,"" said Lin Hui, an analyst at Orient Securities Futures Co in Shanghai.

Gainers & Losers

Cathay Pacific gained 1.4% driven by falling oil prices that fell by more than $7 yesterday.

Sinopec Corp fell 2.7% as China maintained it was not likely to slacken its controls on petroleum products.

Telecommunications stocks advanced on bargain hunting. China Netcom rose 2.2% and China Unicom increased 1.3%. However China Mobile plummeted 1.4%.

Notwithstanding the decline in mainland financial stocks, HSBC gained 0.4% after indicating that it may withdraw from a $6.3 billion offer to buy a controlling stake in Korea Exchange Bank.

Industrial & Commercial Bank of China also increased 0.7% after it said that the bank was unlikely to be affected by the increase in the reserve requirement ratio by the People’s Bank of China.

CITIC International Financial Holdings Ltd climbed 8.3% on news its major shareholder CITIC Group has offered to buy the company for $1.4 billion. Earlier CITIC offered shareholders one China CITIC Bank H share and HK$1.46 cash for each CIFH share, which is at a 21% premium over CIFH''s last share price of HK$5.70.

China CITIC Bank edged down 4.8%.

Gold stocks fell. Sino Gold plummeted 5.6%, Zijin Moning shed 1.4%.